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Q and A: Jonathan Ruffer

by Jonathan Davis

The question to start with is why did you go into investment management and set up your own firm, with all the hassle involved? And secondly, why did you then choose to invest in this particular absolute return style, which I think was very unusual when you started?

Yes. I did English at university and I spent my twenties being useless at everything that I did. I was a barrister twice. I did Corporate Finance at Schroders and staggered back into investment when I was just coming up to 30 in 1980. I worked for a company called Dunbar, whose main claim to fame was that 15% of the company was owned by Sean Connery. We also had another client who organised the Pope’s visit to London in 1982. Dunbar’s shares, which were quoted on the USM, absolutely rocketed because the Pope and 007 were regarded as a sort of each-way bet on things.

I have a crusading spirit about private client fund management, which I think is done really, really badly. I was quite depressed when Lloyd’s of London blew up because that really took out the only group of professionals who were less impressive at fund management. I felt a bit like PQ17. Having seen the oil tanker blow up behind me, we were now the one that all the U-boats were after.

I think the way to understand our business is that it was set up in reaction against the way that the industry works, so it has a certain amount of anger to it. Of the two flags I put up the flagpole, one was trying to surround myself with people who are mad keen on investment. One thing I had noticed about my Dad was that he joined the Royal Marines in 1933 because it was the only place he could see where he could drink 1904 port and fight the enemy. If you think of why people went into the Forces in the 1930s, some did it because their father was in the regiment, some of them did it because they looked good in a uniform, but Montgomery said the real point of being a soldier is to close with the enemy and kill them.

Now, it seems to me that there’s an exact parallel with people going into the investment world today. The point of investment is to take on the markets. In fact, because it sounds such a good profession, and we all pay ourselves well, the milk rounds at university are popular. But investment management attracts a lot of people who are lovely people, kind to Labradors and all the rest of it, but actually comparatively few of them really want to take the markets on. One of the things I wanted to do was to assuage the loneliness for people who are not fixated in a driven way, in the way that I was. We have achieved that. I look round at this place and the driven factor is pleasingly very high.

The other thing was that I simply couldn’t see the point of investing and charging a fee for doing so when you were losing money for people. It seems to me it’s perfectly acceptable for a fund manager to lose money as long as they realise that it’s a bad patch for them. To a certain extent, the battle, I think, is won on that. I think it is won not because of the pioneering spirit of Jonathan Ruffer, but simply because the equity markets haven’t gone anywhere for 10 years, and now we can all see the point of not clinging to them.

As for your question about our style of investment, let’s go back a step. The idea of absolute return is a nonsense. It’s a push-me, pull-you, because if I say to you, “Oh, we’re trying very, hard not to lose any money,” then by definition what I’m saying is “I’m trying very, very hard to be riskless”. But if I’m also saying what we’re trying to do every year is to make, say, 10% a year, by definition what I’m saying to you is that we’re putting risk into the portfolio. So if you’re saying I’m both doing something and doing the opposite of it, it opens up the question “Well, which is it? Are you taking risk or aren’t you taking risk?” You can’t be doing both.

Our answer is that we are definitely taking risk, and it stems from a personal characteristic, which is that I’m risk-averse. For a fund manager to say “I’m risk-averse” is a bit like a fighter pilot saying “I’m a coward.” You’re not paying yourself a compliment. You’re basically saying “I’m incapable of doing the job that I’m setting out to do!” But it’s not a bad handmaiden to have. As long as it’s in the minor key, to be risk averse is fine, but you’ve also got to have something inside you which acts compulsively towards taking risk.

I know that I’m enormously, elementally attracted to taking risks. It is only then that the enormity of what I’m doing kicks in. One of the things that I enjoy saying to potential clients who I judge to be on the greedy side is that we’re not trying to make money for people. What we’re doing is putting risk on the table and filleting what return we can out of it.

If you’d asked me the same question five years ago about how we did it, I wouldn’t have been able to articulate it so clearly. It was this realisation of the push-me, pull-you which made me think “How is it that I don’t see a tension?” and yet that tension is inherent in absolute return. I think it’s because there’s an order to it: first, you take the risk, and then, secondly, you try to mitigate it.

I know that George Soros says that he gets backache when he’s making good decisions – is that how you feel it?

I tell you, on that basis, Jonathan, I’m a world-beater! [Laughter] I’ve got a terrible back!

His point was that he feels the risk elementally.

Yes. The great thing about looking after private clients is that it really raises the stakes. I wanted to go after private clients because it keeps you honest. The problem with investment is that it can be a game, and at worst, it is the problem that dare not speak its name. When you’re losing money for people, you simply cannot bring yourself to think about the effect that it’s having on the people who rely on you.

Looking after private clients, as we do – our traditional business is Old Rectory money – that’s what I’ve always tried to remember. We’re now £8 billion and we look after some enormous accounts. Some of them are people where we really could halve their money and it wouldn’t really affect what they do with their lives at all. But if you have a widow in her late-60s, with £650,000, and you turn that into £500,000, you really do stop them having a holiday in Australia, seeing their grandchildren or changing their car.

To a certain extent, it has been rather a fluke that the punishment so absolutely fits the crime. This idea of looking after private clients and being really concerned about not losing money fits together like a glove. The killer is that when people trust you, which from a marketing point of view is great because it can be years before they spot how badly you’re doing for them, it really gets to me.

I remember saying to a very delightful chap who was an early client and who brought a couple of million to us, and we helped quite a lot “you’re quite my easiest client”. He wasn’t used at all to having that said to him. I said, “Well, it’s simply because, for you this is a commercial decision. If I stop doing well for you, you’ll sack me, and actually it will be your fault if you’ve taken a judgment on me which turns out to be a wrong judgment”. It doesn’t mean I will try any less hard than I will for the people who aren’t in that position. …

I understand, but you’ve still got to organise your business in such a way that you get the right signals back from the clients and you don’t have relationship managers acting as buffers in the way of transmitting that message?

Yes. I suppose there’s a streak of arrogance in us, I think, because the truth is we only do one thing and so when clients ring up and say, “Oh, I don’t like Japan,” and we happen to like Japan, we say, “Oh really?” and go on investing in Japan. The reason is not because we couldn’t care less about their views, but that the way you get this all-weather portfolio is by getting a broad range of assets which protect one another and are protected by one another.

I think of it as a bit like having a child’s mobile, where you have a sort of smiling moon over on the left and a sort of My Little Pony in the middle and Jackanory on the right. If somebody says, “Oh, I don’t like smiley moons,” you can’t just remove the smiley moon because the whole of the mobile then tilts the wrong way. It’s one of the things that we’re regarded as being rather eccentric for is that our funds – the OEICs, which do, in microcosm, what we do for the segregated portfolios – are actually more expensive than the segregated portfolios. Now why is that? The answer is that we take the view that we’re not really in the business of providing a product; we’re in the business of providing a service.

Yes.

And, in a sort of apple pie and motherhood way, saying that you’re a service sounds much better than being a product, but actually a product can be better than a service if it is absolutely consistent. If you were in Anthony Bolton’s fund, it doesn’t matter whether you’re at the top or the bottom of the share register, the result is the same. The person looking after a fund doesn’t have to waste his time glad-handing the clients. What you’ve got here is a number of essentially part-time fund managers looking after a portfolio, as opposed to the product, which is a full-time fund manager looking after a portfolio. My feeling is that if I’m having a funny turn, I want to see a doctor. I don’t want to hit a touch telephone which says “are you whimpering with pain – press five”, or “have you broken out in a sweat – press hash”! I’d rather meet somebody.

So the question is “how do you get consistency?” My observation of our industry is that it falls into one of two bunkers. You can end up with what I call pirate parrots. They are the houses where there is no house view. I mean, you can spot them in the FT columns which are saying “What was your performance like last year?” and they just put “Not applicable”. The reason is that their fund managers are all doing their own thing. There’s an element of sleight of hand there because you aren’t going to XYZ company with your money. You are going to the individual who is managing the money. Not everybody realises that.

The other bunker is not pirate parrots, but chimpanzees, where actually you go and you’ve got your client relationship chap who remembers the name of your Labrador and is absolutely charming, but if you say “Why are you still in BP?” (which we are, having been torpedoed with all hands) what they’re thinking at the back of their mind is “Well, that’s because our oil analyst told us to and so it is not my fault”.

I collect pictures, and I know an artist, who trained at the Slade, and he said what they do on the second day of the Slade is they give you a blank canvas and they tell you to paint a picture of a white car, but you can’t use white paint. Now that – he wasn’t talking about investment at all, but it suddenly hit me that that’s what I want from my fund managers, that what we have is a broad range of assets which need to hang like a child’s mobile, and the truth is that it isn’t written in stone that the smiley moon has to be a particular size.

If you happen to think that the smiley moon wants to be bigger, that’s fine, but it’ll have an effect on the rest of the portfolio, just in the same way that if you are a light blue man and I’m a canary yellow man, we can still have that emphasis within the painting of our car, but we’ll just be using the palate somewhat differently.

Now, the effect of that is twofold. First, you get a better character of fund manager, because you need people who have disciplines of character to be working to a script, and then, at the same time you need people who have the intelligence to understand the often quite sophisticated and complicated interaction between interlocking asset classes. I can look at different fund managers and their performance will often be quite nonplus singly similar. Yet, I can see that’s so-and-so, because he’s always had a soft spot for Japan and he’s majored in that, and I can see the other bits of the portfolio that stack against that.

If somebody had said to me when we were five years in: “Look, you’re still just a cottage industry. Supposing you become something of an institutionally driven business, will you be able to cope? Is this scaleable?” The answer is “Yes, it is. So far, so good, anyway”.

And how many private clients do you have altogether?

Well, when we had £6 billion, the top 30 clients accounted for a third of the business, or £2 billion. The next 300 clients accounted for the next £2 billion, and I wish there had been a further 3,000 who accounted for the last £2 billion, but it was actually about 3,600! So I think we’ve probably got about 4,000 private client units. The truth though is that Mr Smith, Mrs Smith, and the Smith Voluntary Settlement is one for the purposes of that calculation.

The point is that because all the investments are trying to do the same thing, it means that you don’t end up with those anomalies that slow people down, such as: “Oh, I have to remember that Mrs Henderson likes a bit of yield, and that Mrs Clark doesn’t like stocks beginning with D”. There’s none of all that here. The service has many of the elements of the product, and so what each fund manager has here is an associate and a team of people toiling away behind them.

Do you have a sense that there is a limit at which it becomes difficult to do that?

The answer is that I don’t. The thing which alarms me about this business is that our reputation is considerably higher than our ability, and if I was a hedge fund manager and I could short our reputation, it could prove quite a profitable trade. There is always the danger that if people think too highly of you, and you then go wrong, they are dismayed to the point of feeling that there’s been a betrayal.

The truth is that our record is astonishing. We are trying not to lose money and to make, on a one year rolling basis, 10% a year. There has been the odd 12 month period when we might be down 0.3% or 0.8%, but essentially we have never lost money, taking it on a one year perspective, and we’ve compounded at 11.5%. Well, that’s better than Madoff! The truth is that, if you’re making 11.5% a year, some time or other we’re going to have a real downdraft, and the clients are going to say “what’s gone wrong?” and the answer is probably nothing.

Why do you only do long-only investing? Everybody now has the tools to go short.

I don’t know whether you’re aware of, but I’ve put succession plans in place. It’s in the public domain. I put out an announcement in March saying that Henry Maxey, who’s our Chief Investment Officer, is going to be Chief Executive Elect. No businesses like ours seem to make succession plans, yet everybody sits there thinking “God, Jonathan is looking a bit old and decrepit. What is going to happen after he has had his day?” We wrote to all the clients, and the thing which was really extremely nonplussing [laughing] was that the clients showed complete indifference to this.

My colleagues’ morale went up very sharply. I was rather hoping for some serious blubbing, but there was very little of that. The important point is that I control this business. It’s not that I’ve got a fantastic percentage of the equity, but the way the business is constructed, it happens that if I chose to sell this business, my decision to do so would make it very hard for it not to happen. But if I say, as I have done, that this business will not be sold, then that’s equally decisive. What I think has happened is that one smouldering uncertainty, which is whether I will stay on until I’m 93, has now gone. I’m going to stay here for quite a period yet, probably somewhere in the region of a couple of years, but that then I’ll become Chairman and do one day a week.

The bigger uncertainty is whether somebody who joins this place wanting to have a career that will last for a long period of time – and an independent platform like ours is the perfect place to do it – will know whether this place will still be independent in 10 years. Now the likelihood is very much that yes, it will. There are a lot of people who want to become rich, and the hedge fund industry still satisfies that, in that, if you get lucky and you’re skilful, three years can do it for you. But there are a lot of other people who absolutely want, as a by-product of a successful City career, to be rich, but what they actually want is to do the job for a lifetime.

At the moment, it looks as though, for whatever reason, we are effective investors. Now, if I step back, the question will be whether the relationship can remain as it is. The reason I think the answer is yes is that my skill is that I can see the wood for the trees, and if I’m honest, the reason I’m not too distracted by the trees is because I can’t understand them. Henry absolutely can understand the trees, so that he’s always looking at every move and counter-move that’s going on in the marketplace and in the economic world, while I act as his compass.

My own feeling is that, in the last 20 years, I’ve only made four or five big calls and they’ve all been right, and I don’t see any reason why that can’t continue. I read all the economic pornography – we’ve got a library next door of all the grown-up books that dare not speak their name – and I don’t think that will be discontinued.

That sounds sensible, but you haven’t quite answered why derivatives are not taking over.

I can’t understand that. Henry can. What I think – this is not a statement of strategy, but it is a prediction – is that what will happen gradually over the course of time is that instruments which can protect more absolutely and in a more considered way will come increasingly into the portfolios. But it will still be my way of doing it. What is writ in stone here is the philosophy of trying never to lose money. What isn’t written in stone is my way of doing that. You heard it here first!

How do you form your judgments? You read a lot of books. What else?

I think the trouble with human beings, and certainly with the market, is that the market is an idiot savant. If it picks up a thought, it can get almost immediately to the most sophisticated implication that derives from that thought. But if it isn’t thinking that thought, something can be crashingly obvious and nobody picks it up. A good example of that, something that we called to the detail, was the credit crunch of 2008, when we had a double-digit return despite being a long-only house. The truth is that, although the timing of 2008 wasn’t obvious, the event itself was fantastically obvious.

Once every generation or so what happens is that whole societies decide to borrow money. You get an inflection point when greed turns to fear, everybody runs for cover, and everybody wants to sell the collateral. What happens is not just that asset prices go down, but that the markets glitch up and that rocks a financial system to its very foundations. Put like that, the credit crunch was obvious.

I don’t find myself saying “We are geniuses. We saw it coming”. As far as we were concerned, it was more a case of saying “What, you’re off to Moscow in February? Well, do take a thick coat because it will be bloody cold!” In that sense, it was correct predicatively, but the nuance of what is going on there is absolutely obvious. It’s going to be high inflation, with interest rates well below the rate of inflation. Now, that is as strikingly and simply obvious as the credit crunch, but the difficulty is when that is going to happen, and the fact that, between now and then, we might well be looking at teetering over the deflationary edge.

The way I think of it is quite simple. You are in a car driving along a straight road. The tyre blows out, which is the credit crunch. The car lurches to the left, which is deflation. The driver hauls on the wheel, and now the question is are you going to go into the left-hand ditch or the right-hand ditch. People have this extraordinary view that inflation and deflation are opposites, but of course they’re not opposites at all. They’re both examples of monetary instability. I would say what’s the opposite of madness and genius? The answer is not the other, it is accountancy.

Now what’s the opposite of inflation and deflation? The answer is monetary stability. And with the tyre having burst, the common ground, the truth that you can articulate is that we have monetary instability, and then you simply have to work out whether or not the left or the right ditch is going to happen. Now, if you do nothing, the deflationary events which are created by this dislocation means that you are condemned to a depression, as the bad drags down the good.

But if you come at this from a world where the last time America was faced with this, in the 1930s, they created the iconic awful event of the 20th Century, in the same way that for the UK it was the Battle of the Somme, if you’re confronted today with a rock and a hard place, and the rock is the iconic event which must always be avoided, don’t be surprised if you end up within the hard place.

In the other ditch?

Yes, in the other direction. What that tells you is that every time the figures don’t add up, you end up risking letting the iconic event which must never happen again happen. You will always turn the wheel the other way. The key thing is that that actually gives you the clearing system. One way of understanding these debts is that they are like destabilising voids in the body politicks of the economic system. Where you have a debt that cannot be paid off, the system is always looking for a way of filling that void.

Now, the truth is that if you have interest rates well below the rate of inflation, then the savings of savers provide the ballast which solves the problem. That is why in Britain in the ‘70s you ended up with the savers having lost, in real terms, a great deal of money. Yet by 1982, you were in a world where the indebtedness which had threatened to bring down the system in 1974, and had never been paid off in real terms, had been solved. Not only is the left-hand rock the iconic thing that must never happen again, but the right-hand world of currency compromise actually creates a clearing system. So that is what will happen, but it might not happen for years.

And of course one doesn’t need to spend time moralising about whether it’s a good thing or a bad thing.

Yes. If you choose to moralise about it, I think it’s a good thing because, for 30 years, the saver has had a good deal. For 10 years, he has a bad deal. Well, hey, that’s the way the cookie crumbles. It’s just a pity that my job is looking after the turkeys at Christmas time.

Do you think it’s been made worse by the fact that we now have global markets, with people trading all the time, and the banks participating in the whole game as well themselves, and getting slightly confused about their purpose in life? Has that magnified the scale of the problem?

I think what it did do was make possible the borrowing binge that happened. In order to borrow an absurd amount of money means that you need to find a lender who is prepared to lend an absurd amount of money. Without that you don’t have what happened. When people say “where does China fit into this?” the way I see it is, quite simply, that if America borrowed $2 trillion that in retrospect it shouldn’t have done, China for perfectly sound internal reasons lent $2 trillion in return.

And if you want three words that sum up the circumstances prior to the credit crunch, it’s fallacy of composition. Everybody did what made sense to themselves. If that hadn’t happened, then you wouldn’t have got this borrowing binge. It required the Fed to be behaving as they did. It required the existence of Fanny Mae and Freddie Mac to be able to turn their interest rates into spendable money 10 weeks later, and all these building blocks had to be there. In exactly the same way why did the Titanic sink? It required a number of perfectly reasonable things to come together – for White Star to want to win the Blue Riband, for an iceberg to be where it was, and so on. It is when you put all these events together that you end up with a disaster.

It’s all been fascinating to watch, but, as you say, also appalling to watch the train wreck coming. Why couldn’t that translate into effective policy action by Governments to solve those problem? They were sleepwalking to disaster, weren’t they?

I suspect that where we were a rare bird in being a mainline fund management group in having a good 2008 is not that we held these views, but that we held them with sufficient clarity and confidence to invest according to our views.

Whereas, for most people, even if they saw it, they judged that the business risk was too great?

Yes, the point is that they don’t even consider investing in a way that is this extreme. The idea of not having any shares in vast tracts of the marketplace, simply because you think that they’re too risky, is a call that requires a certain attitude of mind which is not without arrogance. I went on a retreat up in Wales, and one of the questions that was put to me by the chap who looks after you is: are you arrogant? It was a frightfully good question, because the answer is absolutely yes and absolutely no! You can see that in what we do here, I think.

You need the confidence to make the big calls when they need to be made, as opposed to making them when they don’t need to be.

I would say it’s having the courage of the hyena – in other words, that if you really can see something that is smaller than oneself, attack it ferociously, but if it shows evidence of being the same size or bigger, run away very fast.

Where we think we are now on the road you described?

Now more than ever, you have to ask the right question, and the question I think that has to be answered is: is it inflation or deflation, the left-hand or the right-hand road? Why these debt dislocations are so dangerous is that the debt cannot be repaid because the dislocation creates deflationary conditions, and there’s going to be no inflation to take the currency strain. The chances of real wages or profits going up enough to pay off the debt, to grow your way out of it, are pretty small.

By definition, if you’ve got a weight of forced sellers waiting in the wings, asset prices are not going to bail you out. So I call this a frog in the swimming pool problem. You can have a great deal of debt, which, in normal conditions, you can grow your way out of. That is the frog in the pond; even if it’s a lake rather than a pond, the frog can always find its way to the bank and then it’ll be okay. But if you create a circumstance where it is a swimming pool and the frog can’t get out of it, at the decisive moment the frog will drown.

The question is: is there going to be a double-dip or is there going to be growth? Is the frog getting tired or has the frog got quite a lot more energy than you think? Is China about to implode or is it the pause that refreshes? Is the Euro going to break up? All these are fascinating questions and they will win you the next battle if you get them right, but the war is about inflation or deflation.

Now, that’s what I mean about the difference between Henry and me. Henry is much, much more fired up to win each of the battles, as well as the war. As far as I’m concerned, I just need to keep safe enough over this period. If you can see the war, then what one has is a group of assets, which I call the treasure, and that what you do is you surround the treasure with other assets whose job is to keep the treasure safe for long enough. It’s about keeping the frog alive, which is really one’s own confidence and the clients’ confidences, for long enough before that comes right.

So, in 2006, 2007 what were we saying to ourselves? The answer is that, during debt dislocation, when markets glitch up, if a river is freezing over, you want to be in the deepest bit of the river that’s still flowing. Now, what is the bit of the markets that keep going when everything else has glitched up? The answer is currencies. Now, we went into 2008 with very big holdings in the Swiss Franc and the Yen, which were the carry trade currencies. If we got a reversal of the carry trade, they were, almost by definition, going to do well for us.

For us, however, the key period was 2006/2007. What did we do in those years? The answer is not very well, but much better than if we’d put all our money into the idea that these were the things to own for the event that was going to happen. We would have lost considerable sums of money as the Yen went lower and lower and lower. Yet we were marvellously vindicated in the end, which was when I was on holiday. It was Henry that did it. In the week of Lehmans, we switched £700 million worth of Swiss Francs into the Yen, because that was the time when everybody was giving up on bank deposits. Governments were coming in behind bank deposits, yet suddenly even in Switzerland, the economy wasn’t big enough to stand behind their banking system.

Indeed.

Through a combination of luck and good judgement, in a week when you couldn’t trade almost anything, we were in a position to trade enormous sums of the Swiss Franc into the Yen. That was a fantastic. It was 20% of our portfolio. I used to try and muscle in and claim some credit for it, but now that Henry’s the Chief Executive Elect, I’m prepared to admit that I was on holiday [laughing]! I was having dung thrown at me down in some Dorset health farm.

The point was you were prepared for this kind of eventuality and the timing was another matter.

Yes.

Currencies are still the place where you can do some things that are useful and helpful to clients?

I’m loathing this year because the truth is that we’re doing quite well so far this year, but nevertheless the one call that I’ve made which I notice has got me into The Week has me caterwauling about how cheap the pound looks. One of the real risks we’ve got in the portfolio are high-beta Japanese financials. If they reflate, and I think what will make them reflate is the Yen strengthening against the Dollar. If there is one thing that the Bank of Japan and the Ministry of Finance really understand, it is how to reflate.

Our judgment is that they were right on the brink of pulling the trigger on that when Greece blew up. We are in a period where the deflationary forces are again looking a bit unpleasant, and of course Japan is the one place that hasn’t pulled the trigger on this front. The mistake they made after 1990 was not to reflate in a way that compromised the currency. They did everything right, but their behaviour was middle-class bad behaviour. It was running round the room with the scissors open. If they had done just that little bit more, and behaved a little more badly, so that they compromised the Yen, then they would have got out of the bind, just as Britain did in the 1970s. They just stopped short of doing enough to be effective. What they saw as a ceiling should have been the starting gate.

So to be clear, what you’re saying they should have done in 1990 is they should have…

Devalued the currency. Borrowed more money. And, , the…em…the…point. There was about to be a brilliant point, Jonathan, and it’s gone, but anyway…

I interrupted you.

No, not at all! But write down “brilliant point…” To be confirmed afterwards!

If that happens, then you think the Japanese equity market will do what?

If you get a very sharp lowering of the currency, you will have a very sharp steepening of the yield curve, which will be fantastic for the financial system. The life companies in Japan are the cheapest businesses in the world. You can buy them at half embedded value, when the going-rate on life companies around the world is 1.6 times embedded value. What long-dated bond yields going up means is that the entire debit side of the life companies’ business, when you discount at the higher rate, melts like the summer snow. At the same time you’ve also got the equity markets surging. For the life companies, you will have the asset side of their balance sheet going up, and the debit side going down, and completely the wrong valuation basis even before that starts. You heard it here first!

The point is that you’re making that bet already, effectively?

Yes, which is hurting us considerably more than helping us [laughing]!

What other sort of bets are you making at the moment?

John Gapper in the FT wrote an article taking one of our themes and making exactly the same point that we’ve been making, which is that high yielding, mega-cap, good balance sheet companies, with strong cash flow, are a natural place to be – the Krafts, the Pfizers, the Vodafones, and so on. There are loads of them. However, what he wrote, and what I’ve been saying too, is that you’ve got to remember what Willie Sutton said about the banks: “Why do you rob banks?” “Well, that’s where the money is”. You’ve got governments all over the world gasping for money. Well, don’t be surprised if the very theme that we’re quarrying isn’t the target, one by one and haphazardly. But it is still a theme that we’re very pleased to be going for. Our equities are mega-cap stocks, and they have big yields on them. Index-linked gilts also work well in this environment, and that’s probably about it really.